Apartment prices have started to fall in Tallinn's Lasnamäe, Mustamäe and Õismäe districts, real estate agents say. Owners are having to reduce prices by up to 20 percent.
A year ago, the average price of a large apartment in Lasnamäe was approximately €170,000 and the sale process was conducted quickly. But the situation is very different today.
Properties can stay on the market for months, even those priced at €150,000, Thursday's "Aktuaalne kaamera" reported.
Real estate company Arco Vara's board member Elari Tamme said owners need to be prepared to accept offers under the asking price if they want to sell. The reduction could be as much as 20 percent.
"The market works is that if the buyer is not prepared to agree [to the price], then there will be no sale. This means that prices have to fall," said Tamm.
She said this situation is mostly related to older apartments and Lasnamäe, Mustamäe and Õismäe districts at the moment.
Apartments needing renovations are more likely to remain unsold, LVM Kinnisvara board member Ingmar Saksing told AK.
"The further away from the city center, the less tidy, the less interest buyers have, and the longer the sales periods last. Above all, people today are buying homes for residential use, which they want to use. They are often bought with a mortgage and people do not really have the time or opportunity to do the renovation work themselves," Saksing said.
Anne Pärgma, head of housing loans at Swedbank, said fewer people want to take out loans.
"If, at the beginning of the year, there were around 1,000 loan applications every week, maybe even more than a thousand, then there are now far fewer — less than 700," she said, adding people are behaving more cautiously at the moment.
However, the size of the average housing loan has increased, which suggests buyers are gravitating towards newer properties, AK said.
Editor: Merili Nael, Helen Wright
Source: Aktuaalne kaamera